It’s no mystery that states have struggled through the economic downturn, as revenues have dropped with rising unemployment and falling consumer spending, while
It’s no mystery that states have struggled through the economic downturn, as revenues have dropped with rising unemployment and falling consumer spending, while increased enrollment in social services like Medicaid have just made problems worse. But will Congress treat all states equal in the middle of this nationwide state budget squeeze? Not if some members have their way.
Senate Majority Leader Harry Reid (D), for example, has used his considerable sway to carve out a special provision for Nevada in the health reform bill working its way through the Senate Finance Committee this month, The New York Times reported today. Under that proposal, states will be required to cover all residents living below 133 percent of the federal poverty level, or $29,327 for a family of four. And while Washington would pick up most of the tab of that expansion, states will have to pay a percentage (between 5 percent and 23 percent depending on the relative wealth of the state).
Reid, though, forged a deal with Finance Committee leaders to exempt Nevada from paying any part of that expanded coverage for the first five years, The Times reported. Three other states — Michigan, Oregon and Rhode Island — would also qualify for the exemption. And that’s all well and good, except that, according to The Times, “The changes came at the expense of other states, including California, Florida and Illinois, which would see significant increases in state Medicaid spending under the new formula.”
Reid is up for a tough reelection next year, so the impetus is understandable. But you can bet those lawmakers representing California, Florida and Illinois haven’t said their last word.
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